A day after the monetary policy committee (MPC) debuted with a surprise 0.25 percent cut in rates, analysts today said the Reserve Bank will continue with the accommodative stance but the next action can come only in the February review. In a note, domestic rating agency Icra said it expects the rate easing cycle to continue.
“With the indication that real interest rates (the differential between the key lending rate and inflation) may need to be lower than 1.50 percent given prevailing global scenario of negative rates, further easing by the Monetary Policy Committee (MPC) can’t be ruled out,” its senior vice president Karthik Srinivasan said, adding that he is uncertain over the timing.
The market remains sluggish as the Sensex is down 87.16 points or 0.3 percent at 28247.39 and the Nifty is down 23.15 points or 0.3 percent at 8746. About 1655 shares have advanced, 1077 shares declined, and 122 shares are unchanged.
Asian Paints, SBI, Tata Motors, HUL and Maruti Suzuki are top gainers while ONGC, Axis Bank, M&M, Bajaj Auto and Hero MotoCorp are major losers in the Sensex. SBI, Force Motors, Vakrangee and Hindustan Zinc are most active stocks in the BSE.